JBP's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.comuser/239747/comments http://seekingalpha.com/article/175798-is-silver-really-a-better-investment-than-gold?source=feed#comment-783290 783290 Mon, 30 Nov 2009 17:48:24 -0500 http://seekingalpha.com/article/139205-why-gold-enthusiasm-is-cool-again?source=feed#comment-514459 514459 Fri, 22 May 2009 11:34:55 -0400 http://seekingalpha.com/article/137557-rising-long-term-interest-rates-go-hand-in-hand-with-the-expanding-economy?source=feed#comment-504250 504250 NAB) program from $50 billion to $500 billion.

President Obama is portraying this loan as an investment rather than an expenditure when he stated in the letter, "Such participation effectively represents an exchange of assets rather than a budgetary expenditure, and it will not result in budgetary outlays or any increase in the deficit. That is because when the United States transfers dollars to the IMF under the NAB, the United States receives in exchange another monetary asset in the form of a liquid, interest-bearing claim on the IMF, which is backed by the IMF's strong financial position, including its significant holdings of gold."

The supposed purpose of the increase in the NAB is to help combat worldwide financial crises. The United States would provide 20 percent of the assets for this purpose. China has already committed to lend $40 billion.

There is a small chance that the difficult-to-understand language in President Obama's letter could be taken at face value.

But, I don't really think so. There are a lot of implications to this proposed loan beyond what appears on the surface.

There is growing pressure on the IMF to actually sell some or all of its supposed gold holdings. If this pressure becomes strong enough that action is taken, there are a number of potential problems that could be exposed:



" The IMF does not physically hold the gold. It has been pledged by member nations who, in theory, have delivered the gold to one of four countries designated as depositories. The United States and United Kingdom are two of the designated depositories. It is entirely possible that one or more nations might, if called to turn over their gold, default on delivering their gold commitment.

" Although the IMF tries to pretend that it audits the gold holdings, it then immediately contradicts itself by reporting that holdings in depositories are not audited by the IMF.

" There is significant suspicion that some of the gold pledged to the IMF has been leased. If the IMF were to try to sell it, that could force the recall of some gold leases.

" It is also possible that some of the gold pledged to the IMF has conflicting ownership claims.

" The IMF only theoretically has 3,217 tons of gold, which at $920 gold spot is worth only $95 billion. Where would be the collateral for the other $400 billion of planned borrowings?



I'm not saying that there is any outright proof of the existence of any of these above problems. However, when the Gold Anti-Trust Action Committee made multiple attempts to clarify the nature of IMF gold holdings. The IMF's answers simply did not respond to the questions asked by GATA. If there were no problems with any of these issues, I would have expected the IMF to make straight statements to that effect.

Another implication is that the U.S. government is holding the gold it has pledged to the IMF as part of the collateral for the "loan." At the most extreme, this may be a sneaky way for the U.S. government to accomplish two goals - increasing its gold position by reducing its gold liability to the IMF and increasing its physical reserves, and to latch on to IMF gold rather than let China purchase all of it. Under these scenarios, the "loan" would never be repaid in U.S. dollars.

If the U.S. government is really trying to find a way to acquire more gold, and trying to do so in a way that the public does not know about, the implication is that, at today's levels, the U.S. dollar is significantly overvalued. Also implied is that gold is underpriced today.

The known fact is that President Obama has asked congressional leaders to pass legislation to enable this $100 billion loan. The rest is speculation as to what is really occurring, when placed in the context of all the other global financial calamities.]]> Thu, 14 May 2009 15:51:46 -0400 NAB) program from $50 billion to $500 billion.

President Obama is portraying this loan as an investment rather than an expenditure when he stated in the letter, "Such participation effectively represents an exchange of assets rather than a budgetary expenditure, and it will not result in budgetary outlays or any increase in the deficit. That is because when the United States transfers dollars to the IMF under the NAB, the United States receives in exchange another monetary asset in the form of a liquid, interest-bearing claim on the IMF, which is backed by the IMF's strong financial position, including its significant holdings of gold."

The supposed purpose of the increase in the NAB is to help combat worldwide financial crises. The United States would provide 20 percent of the assets for this purpose. China has already committed to lend $40 billion.

There is a small chance that the difficult-to-understand language in President Obama's letter could be taken at face value.

But, I don't really think so. There are a lot of implications to this proposed loan beyond what appears on the surface.

There is growing pressure on the IMF to actually sell some or all of its supposed gold holdings. If this pressure becomes strong enough that action is taken, there are a number of potential problems that could be exposed:



" The IMF does not physically hold the gold. It has been pledged by member nations who, in theory, have delivered the gold to one of four countries designated as depositories. The United States and United Kingdom are two of the designated depositories. It is entirely possible that one or more nations might, if called to turn over their gold, default on delivering their gold commitment.

" Although the IMF tries to pretend that it audits the gold holdings, it then immediately contradicts itself by reporting that holdings in depositories are not audited by the IMF.

" There is significant suspicion that some of the gold pledged to the IMF has been leased. If the IMF were to try to sell it, that could force the recall of some gold leases.

" It is also possible that some of the gold pledged to the IMF has conflicting ownership claims.

" The IMF only theoretically has 3,217 tons of gold, which at $920 gold spot is worth only $95 billion. Where would be the collateral for the other $400 billion of planned borrowings?



I'm not saying that there is any outright proof of the existence of any of these above problems. However, when the Gold Anti-Trust Action Committee made multiple attempts to clarify the nature of IMF gold holdings. The IMF's answers simply did not respond to the questions asked by GATA. If there were no problems with any of these issues, I would have expected the IMF to make straight statements to that effect.

Another implication is that the U.S. government is holding the gold it has pledged to the IMF as part of the collateral for the "loan." At the most extreme, this may be a sneaky way for the U.S. government to accomplish two goals - increasing its gold position by reducing its gold liability to the IMF and increasing its physical reserves, and to latch on to IMF gold rather than let China purchase all of it. Under these scenarios, the "loan" would never be repaid in U.S. dollars.

If the U.S. government is really trying to find a way to acquire more gold, and trying to do so in a way that the public does not know about, the implication is that, at today's levels, the U.S. dollar is significantly overvalued. Also implied is that gold is underpriced today.

The known fact is that President Obama has asked congressional leaders to pass legislation to enable this $100 billion loan. The rest is speculation as to what is really occurring, when placed in the context of all the other global financial calamities.]]> http://seekingalpha.com/article/120862-don-t-kick-yourself-later-for-not-buying-gold-and-silver-now?source=feed#comment-391932 391932 Tue, 17 Feb 2009 10:12:40 -0500 http://seekingalpha.com/article/105372-how-to-save-the-u-s-economy?source=feed#comment-303419 303419 Tue, 11 Nov 2008 17:40:28 -0500 http://seekingalpha.com/article/103156-cramer-s-lightning-round-i-like-nike-10-30-08?source=feed#comment-298184 298184 Tue, 04 Nov 2008 13:45:20 -0500 http://seekingalpha.com/article/102368-don-t-be-fooled-inflation-is-coming?source=feed#comment-293799 293799
What investment is good for stagflation as you predict?]]> Wed, 29 Oct 2008 16:56:39 -0400
What investment is good for stagflation as you predict?]]> http://seekingalpha.com/article/102339-ignore-the-hype-gold-as-currency-is-dead?source=feed#comment-293018 293018 Tue, 28 Oct 2008 21:12:51 -0400 http://seekingalpha.com/article/102368-don-t-be-fooled-inflation-is-coming?source=feed#comment-293016 293016
One word on commodities, Asia. They were basically non-existent in the 70's and we hadn't reached peak oil at that time. World population keeps growing while commodities are being squeezed whether it's from limited sources or the high production costs to run mines. Food, cotton, etc. included. Yet, I'm glad people believe the way yo do because you have to have losers to have winners. I just think my case along with others is much more compelling than yours. This world is not coming to an end... Good luck.]]> Tue, 28 Oct 2008 21:08:25 -0400
One word on commodities, Asia. They were basically non-existent in the 70's and we hadn't reached peak oil at that time. World population keeps growing while commodities are being squeezed whether it's from limited sources or the high production costs to run mines. Food, cotton, etc. included. Yet, I'm glad people believe the way yo do because you have to have losers to have winners. I just think my case along with others is much more compelling than yours. This world is not coming to an end... Good luck.]]> http://seekingalpha.com/article/102368-don-t-be-fooled-inflation-is-coming?source=feed#comment-292620 292620
The most fundamental monetary aggregate also calculated by Williams is called the adjusted monetary base, which measures very liquid forms of money such as bank notes and bank reserves. In his latest missive, Williams points out that the monetary base has recently exploded at a rate unprecedented in history -- up 38% year-over-year. Not even in the 1930s was so much money created so quickly. In fact, the only other time the monetary base grew anywhere near this quickly was during the build-up for World War II, when we needed a lot of cash to convert factories into making armaments.

Williams point is that all this cash is eventually going to work its way into the economy. The good news is that banks will have unprecedented amounts of money to lend, which will make them willing to lend more money at much lower rates. The Fed Funds rate will likely drop to 1% this week. Considering that banks can borrow money at the Fed Funds rate, deposit it at the Fed, and earn interest on those deposits, they will have access to virtually free money. So once the psychological impact of the current financial crisis wears off, we will be faced with an unprecedented rise in credit and monetary largess.

The next act in our economic drama could go one of two ways. One possibility is that all this new money will never find its way into the economy, because it will be overwhelmed by psychological factors, such as fear, which will make people stop borrowing and spending and plunge the world into a horrific depression accompanied by deflation.

However, I doubt that will happen. It's just not as likely as the alternative.
Instead, the most likely scenario is one of horrific inflation...

I expect a turnaround will occur in the near future in which the price of oil soars $2 for every $1 that it fell since last spring. Inflation may not hit record levels right away, but it will in time.

Prices of all commodities will soar. Gold especially...
]]> Tue, 28 Oct 2008 13:41:53 -0400
The most fundamental monetary aggregate also calculated by Williams is called the adjusted monetary base, which measures very liquid forms of money such as bank notes and bank reserves. In his latest missive, Williams points out that the monetary base has recently exploded at a rate unprecedented in history -- up 38% year-over-year. Not even in the 1930s was so much money created so quickly. In fact, the only other time the monetary base grew anywhere near this quickly was during the build-up for World War II, when we needed a lot of cash to convert factories into making armaments.

Williams point is that all this cash is eventually going to work its way into the economy. The good news is that banks will have unprecedented amounts of money to lend, which will make them willing to lend more money at much lower rates. The Fed Funds rate will likely drop to 1% this week. Considering that banks can borrow money at the Fed Funds rate, deposit it at the Fed, and earn interest on those deposits, they will have access to virtually free money. So once the psychological impact of the current financial crisis wears off, we will be faced with an unprecedented rise in credit and monetary largess.

The next act in our economic drama could go one of two ways. One possibility is that all this new money will never find its way into the economy, because it will be overwhelmed by psychological factors, such as fear, which will make people stop borrowing and spending and plunge the world into a horrific depression accompanied by deflation.

However, I doubt that will happen. It's just not as likely as the alternative.
Instead, the most likely scenario is one of horrific inflation...

I expect a turnaround will occur in the near future in which the price of oil soars $2 for every $1 that it fell since last spring. Inflation may not hit record levels right away, but it will in time.

Prices of all commodities will soar. Gold especially...
]]> http://seekingalpha.com/article/102122-80-years-history-of-brutal-gold-stock-corrections-how-does-today-compare?source=feed#comment-292108 292108
M3 has been recently independently calculated at 38%. Good for gold/commodities. People will not be tired of the gold trade once it starts going higher and nothing else is because of the printing presses.]]> Mon, 27 Oct 2008 23:17:30 -0400
M3 has been recently independently calculated at 38%. Good for gold/commodities. People will not be tired of the gold trade once it starts going higher and nothing else is because of the printing presses.]]> http://seekingalpha.com/article/102135-approaching-zero?source=feed#comment-292090 292090 Mon, 27 Oct 2008 22:50:31 -0400 http://seekingalpha.com/article/101751-the-favorable-outlook-for-gold?source=feed#comment-289881 289881 Fri, 24 Oct 2008 16:39:17 -0400 http://seekingalpha.com/article/101118-survival-of-the-fittest-save-haven-investments?source=feed#comment-287800 287800
Do you not see the Norilsk mine opening back up once the price increases bringing on more supply? Also, what is the play on physical palladium? Any ETF like SLV of GLD? ]]> Wed, 22 Oct 2008 11:19:08 -0400
Do you not see the Norilsk mine opening back up once the price increases bringing on more supply? Also, what is the play on physical palladium? Any ETF like SLV of GLD? ]]> http://seekingalpha.com/article/98230-some-true-safe-havens-are-still-surprisingly-undervalued?source=feed#comment-272010 272010 Thu, 02 Oct 2008 16:24:55 -0400 http://seekingalpha.com/article/98230-some-true-safe-havens-are-still-surprisingly-undervalued?source=feed#comment-272006 272006 Thu, 02 Oct 2008 16:23:41 -0400 http://seekingalpha.com/article/98008-gld-amassing-physical-gold?source=feed#comment-270516 270516 Wed, 01 Oct 2008 12:28:05 -0400 http://seekingalpha.com/article/97853-market-safe-havens-rapidly-dwindling?source=feed#comment-268878 268878 Mon, 29 Sep 2008 16:46:42 -0400 http://seekingalpha.com/article/97318-it-s-the-end-of-the-world-as-we-know-it-and-i-own-gold?source=feed#comment-265040 265040 Thu, 25 Sep 2008 14:10:44 -0400 http://seekingalpha.com/article/97318-it-s-the-end-of-the-world-as-we-know-it-and-i-own-gold?source=feed#comment-264873 264873 Thu, 25 Sep 2008 11:51:02 -0400 http://seekingalpha.com/article/96855-xlf-financial-barometer?source=feed#comment-263098 263098 Tue, 23 Sep 2008 23:12:11 -0400 http://seekingalpha.com/article/96330-precious-metals-scapegoats-to-skyrockets?source=feed#comment-259417 259417 Fri, 19 Sep 2008 15:24:09 -0400 http://seekingalpha.com/article/95974-gold-may-not-be-just-another-commodity-anymore?source=feed#comment-257588 257588 Wed, 17 Sep 2008 22:36:23 -0400 http://seekingalpha.com/article/95974-gold-may-not-be-just-another-commodity-anymore?source=feed#comment-257587 257587 Wed, 17 Sep 2008 22:35:51 -0400 http://seekingalpha.com/article/95957-panic-investors-gold-or-silver?source=feed#comment-257117 257117 Wed, 17 Sep 2008 12:44:46 -0400 http://seekingalpha.com/article/94828-one-last-decline-then-the-rebound-in-gold?source=feed#comment-250891 250891
So what is your prediction for gold? ]]> Wed, 10 Sep 2008 16:26:43 -0400
So what is your prediction for gold? ]]> http://seekingalpha.com/article/94579-six-situations-to-monitor-for-the-remainder-of-2008?source=feed#comment-249947 249947
Today, the market had its worst daily decline since February 2007. The S&P 500 dropped 3.4 percent. This decline was not led by commodities, but financial stocks, as concerns about banks and investment banks prevailed. Shares of Lehman fell 45 percent in one day on renewed concerns about capital and as its talks with Korea Development Bank broke down.



The sell-off in commodities also continued. Declines such as the one we're experiencing can become irrational and can continue longer than the fundamentals should justify. This is a selling panic triggered by liquidity needs and, in part, by a stronger dollar. In the midst of it, we take comfort in the knowledge that the secular bull market in commodities remains in place, and that the downside risk from here is dwarfed by the upside potential in the coming months and years.



We will offer you two comments by industry leaders who are undeniably bullish long-term. First came from BHP Billiton's Chief Executive, Marius Kloppers (perhaps the smartest guy in the business). Yesterday he indicated that the slowing world economy will likely cause demand for raw materials to slide further in the short run. However, the downturn has done nothing to deter Kloppers from attempting to acquire Rio Tinto. The second comment is from Goldcorp's CEO Kevin McAuthur. Speaking at a conference yesterday, he described the current commodities market as a fire sale and attributed the decline in gold and related commodities to desperate hedge funds who are forced to shed assets to raise cash. McAuthur told participants that gold prices would soar to $1,500 in the next 18 months.



Stocks, meanwhile, are likely to remain mired in a trading range. Although we view stock selection as the most important part of investment process, we remain mindful of low valuations within most commodity stocks. While downside seems limited from here, the upside potential is significant.

]]> Tue, 09 Sep 2008 23:36:27 -0400
Today, the market had its worst daily decline since February 2007. The S&P 500 dropped 3.4 percent. This decline was not led by commodities, but financial stocks, as concerns about banks and investment banks prevailed. Shares of Lehman fell 45 percent in one day on renewed concerns about capital and as its talks with Korea Development Bank broke down.



The sell-off in commodities also continued. Declines such as the one we're experiencing can become irrational and can continue longer than the fundamentals should justify. This is a selling panic triggered by liquidity needs and, in part, by a stronger dollar. In the midst of it, we take comfort in the knowledge that the secular bull market in commodities remains in place, and that the downside risk from here is dwarfed by the upside potential in the coming months and years.



We will offer you two comments by industry leaders who are undeniably bullish long-term. First came from BHP Billiton's Chief Executive, Marius Kloppers (perhaps the smartest guy in the business). Yesterday he indicated that the slowing world economy will likely cause demand for raw materials to slide further in the short run. However, the downturn has done nothing to deter Kloppers from attempting to acquire Rio Tinto. The second comment is from Goldcorp's CEO Kevin McAuthur. Speaking at a conference yesterday, he described the current commodities market as a fire sale and attributed the decline in gold and related commodities to desperate hedge funds who are forced to shed assets to raise cash. McAuthur told participants that gold prices would soar to $1,500 in the next 18 months.



Stocks, meanwhile, are likely to remain mired in a trading range. Although we view stock selection as the most important part of investment process, we remain mindful of low valuations within most commodity stocks. While downside seems limited from here, the upside potential is significant.

]]> http://seekingalpha.com/article/94392-metals-manipulation-or-simply-deleveraging?source=feed#comment-248648 248648
Actually, you're wasting your own time because I'm sure by now people just skip your posts. You can't spell and you don't make any sense or valid arguments on the intended subject. Nobody gives a sh*t what you made today....]]> Mon, 08 Sep 2008 14:52:27 -0400
Actually, you're wasting your own time because I'm sure by now people just skip your posts. You can't spell and you don't make any sense or valid arguments on the intended subject. Nobody gives a sh*t what you made today....]]> http://seekingalpha.com/article/93371-four-reasons-why-gold-s-a-slam-dunk-investment?source=feed#comment-244002 244002
I hear nothing but bashing regarding commodities in the media. You do realize that you're in a gold message board where some people may actually believe in the upside don't you? Also, hopefully you know $800 then is like $2300 now. If you think it's going down that's fine, but make better arguments.]]> Tue, 02 Sep 2008 14:59:18 -0400
I hear nothing but bashing regarding commodities in the media. You do realize that you're in a gold message board where some people may actually believe in the upside don't you? Also, hopefully you know $800 then is like $2300 now. If you think it's going down that's fine, but make better arguments.]]> http://seekingalpha.com/article/93371-four-reasons-why-gold-s-a-slam-dunk-investment?source=feed#comment-244001 244001
What do you think the LT tax rate will be when Obama takes office on any investment? 25% which is 3% from gold? Also, physical gold often isn't reported once sold. Some people aren't paying any taxes on gains.... Much better than the "current" 15%!]]> Tue, 02 Sep 2008 14:54:54 -0400
What do you think the LT tax rate will be when Obama takes office on any investment? 25% which is 3% from gold? Also, physical gold often isn't reported once sold. Some people aren't paying any taxes on gains.... Much better than the "current" 15%!]]>